George Osborne is to say that Britain should remain in a reformed European Union and that the UK has allies in its push for liberalisation of regulations that could hinder growth.

In a major speech on Europe next week, the Chancellor will say that as the economic recovery puts Britain at the top of growth league in the European Union, the reform agenda is gaining momentum.

He will also make it clear that Britain is gaining support as it pushes for changes in the way the EU operates.

The Chancellor has held negotiations with the German finance minister, Wolfgang Schäuble, and there have also been discussions with the Spanish government, which is putting in place flexible labour market reforms to help businesses.

Treasury sources made it clear that at this stage the Chancellor would not outline which reforms he wants to see the EU undertake, although it is understood that employment is a key area.

His words at the Fresh Start conference on Thursday will echo the Prime Minister, who said last year that Britain was better off in the EU providing “some aspects” of the relationship were changed,

Andrea Leadsom, the Conservative MP for South Northamptonshire who is the co-founder of Fresh Start which was launched 2011, warned this weekend that Britain’s financial services sector is at “greatest risk” without reform and has urged ministers to work for a new deal.

She said: “There is a risk that eurozone integration leaves the UK and other non-euro countries as bystanders. From this year, in theory, the eurozone can out vote non-euro countries every time through an inbuilt majority, particularly given that most decisions can be made through a majority vote.

“The risk is the greatest where the single market in financial services and the fledgling eurozone banking union overlap.”

Writing in The Sunday Telegraph today, Peter Cruddas, the founder of CMC Markets, reveals that he has joined the board of Business for Britain, an organisation that is pushing for change in the terms of Britain’s membership of the EU.

“When I look at the EU, I no longer see a set of institutions that are helping further the ambitions of so many people to get on in life,” he said.

He warned that the proposed Financial Transactions Tax would be a “disaster for the City”, adding: “ This is only the tip of the iceberg of anti-competitive measures that Brussels is aiming at our financial services industry.”